Small businesses feeling economic downturn too

The headlines surrounding the economy tend to focus on billion dollar bailouts for large corporations and major companies laying off thousands of work. But, most private sector employees in the U.S. work for small businesses. Denise Diaz is co-owner of a small business called Ritual Cafe, a coffee shop on the western edge of downtown Des Moines.

"I have noticed our regulars aren’t so regular," Diaz said. "I think people are more aware of their spending. We are selling a lot more house coffee and a lot less of the fru-fru drinks, the high-end drinks." Diaz says she is optimistic about the future, but recently reduced her part-time employee’s hours in half to cut costs. Next door to Ritual Café is Proof, a four month-old restaurant.

Owner Carly Groben says since the restaurant opened right when the recession started to take hold, it’s hard to determine the impact.

"When people start cutting down their budget, the first thing they cut is eating out and fancy food," Groben acknowledged. "But we’re mostly a lunch restaurant, and everything on our menu is ten dollars or less. So we feel that even if people are cutting back on eating out, they might still go out for lunch."

Just down the street from Proof is B-N-I-M, an architecture firm that specializes in public buildings and sustainable design. Rod Kruse is the principal architect in the office that employs seven people and two interns. He says business is good. "I sometimes think if Iowans didn’t get up and read the newspaper, we wouldn’t slow down. I think the economy here is solid, and I think everyone is optimistic about the future," Kruse said. The firm has more work than it can comfortably handle for the next three months, and has several bids pending for new jobs.

Kruse says he is noticing those bids are a bit more crowded than in the past. "The competition is more challenging," Kruse said. "We see more people asking about work – jobs where you once saw four or five or six firms interested, now you see 10, 12 or 15 now." Kruse says he is confident that if the firm wins some of those new jobs, he will be able to stay on track to grow the office to 15 to 20 employees.